Answer: d. short-term lease expense.
Explanation:
The debit has to go to an expense account to recognize that a lease expense is being incurred. The relevant account would be a short-term lease expense account because the lease is a short term lease as it is to last for less than a year.
The credit will go to an accrued lease account to recognize that it is a current liability because liabilities are credited when they increase.
[ Shareholders - Employees - Managers - Officers - Board of Directors ]
(a) Who manages the big picture and strategies for corporations, and who manages the day to day affairs of a corporation?
(b) How are each put in their position?
Use the following information about the current year's operations of a company to calculate the cash paid for merchandise.
Cost of goods sold……………………………….. $ 735,000
Merchandise inventory, January 1………………. 84,700
Merchandise inventory, December 31…………… 82,400
Accounts payable, January 1……………………. 54,500
Accounts payable, December 31……………….. 60,200
Answer:
$727,000
Explanation:
Calculation of cash paid for merchandise
Cost of goods sold
$735,000
Add:
Merchandise inventory, December 31
$82,400
Less:
Merchandise inventory, January 1
($84,700)
Purchases during the period
$732,700
Add:
Accounts payable, January 1
$54,500
Less:
Accounts payable, December 31
($60,200)
Cash paid for merchandise
$727,000
Nut and Bolt guy Inc, sells nuts, bolts, fasteners and other related equipment. The CFO projects that net FCF for the next three years will be $11,000, $12,500 and $16,000, respectively. After that, the cash flows are expected to increase by 4.5 percent annually. What is the value of the firm if the WACC is 12.2%?
Answer:
$184791
Explanation:
The calculation of the value of the firm is given below:
Year Future Cash Flow PVF at 12.2% PV of Cash Flow
1 11000 0.891 9801
2 12500 0.794 9925
3 16000 0.708 11328
Total 31054
Present Value of Terminal Value
= [16000 × (1 + 0.045) ÷ 0.122 - 0.045] × 0.708
= [16720 ÷ 0.077] × 0.708
= 153737
Now
value of Firm = 31054 + 153737
= $184791
What is the answer to this question? B or C?
Answer:B
Explanation: everything had a code of ethics.
Janice has been invited to appear on a home improvement show for the remodel of her summerhouse in Maine. Janice asks Mary to wallpaper her house in anticipation of the home improvement, and requests expensive custom wallpaper and a very intricate design application, for which the wallpaper would cost $5000, plus labor. Mary, excited for a very large job for her solo business, orders the intricate wallpaper and blocks off her calendar for the amount of time it will take to complete the job. After the paper has been ordered, Mary asks some friends to be available to complete the job in time for the show. Janice is informed that she will not be on the show and notifies Mary that she will not need the wallpaper.
a. Does Mary have a case for re-imbursement?
b. Under what legal theory might she prevail and what are her damages, if any?
c. What ethical theories might be applicable?
Answer:
sorry I don't know.
Explanation:
Yes, Mary has a legal cause of reimbursement Under the legal theory of ethical violation.
What is ethical violation?A documented company's code of ethics, mission, vision, values, and culture are violated when something is spoken, published, or done that does so. Additionally, we are aware that moral transgressions laugh in the face of accepted social norms.
Most business professionals' ethical conduct is governed by codes of conduct. Business infractions including discrimination, safety issues, or poor working conditions are most frequently observed.
Additionally, fraud, theft, and conflicts of interest. Many of these cross the line into illegal territory that is dealt with outside the corporation and are not merely morally bad.
Customers may be charged for services they did not receive when there is improper or fraudulent billing. This occurs most frequently in professions where the person who pays the bill is different from the person who received the services.
Due to the frequency of this particular ethical breach, many insurance companies have started providing consumers with a list of services that may fall under this category, enticing them to report any irregularities.
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On April 1, a company established a $150 petty cash fund. On April 15, the petty cash fund contains $5 in cash and the following paid petty cash receipts: Petty Cash Receipts Amount Advertising Expense $29.00 Gasoline Expense38.00 Miscellaneous Expense 50.00 Office Supplies 25.00 Prepare the general journal entries to (1) establish the petty cash fund, to (2) reimburse the fund, and to (3) increase its amount to $200 on April 15.
1. General journal entries to establish the petty cash fund
Date Account titles Debit Credit
April 1 Petty cash $150
Cash $150
2. General journal entries to reimburse the fund
Date Account titles Debit Credit
April 15 Advertising Expense $29.00
Gasoline Expense $38.00
Miscellaneous Expense $50.00
Office Supplies $25.00
Cash over and short $3
Cash ($150-$5) $145
3. General journal entries to increase its amount to $200 on April 15.
Date Account title s Debit Credit
April 15 Petty cash ($200-$150) $50
Cash $50
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Roanoke Company produces chocolate bars. The primary materials used in producing chocolate bars are cocoa, sugar, and milk. The standard costs for a batch of chocolate (5,200 bars) are as follows:
Ingredient Quantity Price
Cocoa 400lbs. $1.25per lb.
Sugar 80lbs. $0.40per lb.
Milk 120gal. $2.50per gal.
Determine the standard direct materials cost per bar of chocolate. Round to two decimal places.
Answer:
$0.16
Explanation:
Particulars Quantity Price Amount
Cocoa 400 $1.25 $500
Sugar 80 $0.40 $32
Milk 120 $2.50 $300
Total $832
Standard direct materials cost per bar = Total amount / Number of bar
Standard direct materials cost per bar = $832 / 5,200 bars
Standard direct materials cost per bar = $0.16
A company must repay the bank $10,000 cash in three years for a loan. The loan agreement specifies 8% interest compounded annually. The present value factor for three years at 8% is 0.7938. How much cash did the company receive from the bank on the day they borrowed this money?
A. $12,400.
B. $9,200.
C. $7,938.
D. $7,600.
E. $10,000.
Answer: C. $7,938
Explanation:
This is a straightforward question. From the question, we are informed that a company must repay the bank $10,000 cash in three years for a loan and that the loan agreement specifies 8% interest compounded annually and we are given the present value factor for three years at 8% is 0.7938.
Therefore, the amount of cash that the company receive from the bank on the day they borrowed this money will be:
= $10000 × Present value factor at 8%
= $10000 × 0.7938
= $7938
Stock Z is trading at $50 today. In one year, the value will go either up to $62.50 or down to $40. A call option on Z with exactly one year to expiration has a strike price of $55. Inflation is high, so the interest rate is 10% per year. Find the delta of the call option using binomial approach. a. 0.25 b. 0.67 c. 1.05 d. 0.33
Answer:
0.33
Explanation:
Delta = (Cu – Cd)/(Su – Sd)Cu
= 62.50 – 55 = 7.50
Cd = 0
Delta = (7.50 – 0)/(62.50 – 40)
= 0.33
Zachary Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,100 containers follows. Unit-level materials $ 6,400 Unit-level labor 6,400 Unit-level overhead 3,800 Product-level costs* 8,400 Allocated facility-level costs 28,000 *One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Zachary for $2.70 each. Required Calculate the total relevant cost. Should Zachary continue to make the containers
Answer:
Zachary Electronics
Zachary should continue to make the containers. It is cheaper to make than to buy from Russo Container Company.
Explanation:
a) Data and Calculations:
Production units = 9,100 containers
Unit-level materials $ 6,400
Unit-level labor 6,400
Unit-level overhead 3,800
Total unit-level costs $16,600
Product-level costs* 8,400
Allocated facility-level costs 28,000
Relevant or avoidable costs:
Unit-level materials $ 6,400
Unit-level labor 6,400
Unit-level overhead 3,800
Total unit-level costs $16,600
Product-level costs* 2,800 ($8,400 * 1/3)
Total relevant costs = $19,400 (to make)
Relevant cost to buy:
Offer from Russo Container company = $2.70 per container
Total cost from outside supplier = $24,500 ($2.70 * 9,100)
Sometimes it is necessary to invest a certain amount of money at a fixed interest rate for a fixed number of year so that a financial goal is met. The inital amount invested in called the present value.
a. True
b. False
Answer: True
Explanation: financial goals is an important step toward becoming financially secure.
Bangladesh has been the 7 th largest mango exporter in the world and exported 1-billion-dollar worth of vegetables across the world. Within 1000 words, discuss i) How can we internationalize our productions? ii) How can we localize our productions? Discuss some research oriented examples.
Answer:
Private companies added 330,000 jobs in July, according to ADP, far short of the 653,000 estimate
Explanation:
Private companies added 330,000 jobs in July, according to ADP, far short of the 653,000 estimate:The 330,000 new positions is a sharp deceleration from the 680,000 added in June and the lowest total since February. Leisure and hospitality led the gains with 139,000 during a month in which goods-producing industries contributed just 12,000 jobs. #accelerationism
Bob has saved $30 per week to buy a new Blu-ray player. He compares two different models: a Panaview that is priced at $130 and a Zony model that is priced at $140. Bob decides to purchase the Zony Blu-ray player for $140. Identify what role money plays in each of the following parts of the story.
a. Sean can easily determine that the Panaview model has a lower price than the Zony model.
b. Sean saved $30 per week.
c. Sean pays $140 for the Blu-ray player.
Answer and Explanation:
The categorization is as follows:
a. It is a unit of account as it determined the panaview model along with the zony model plus the comparison is also there
b. It is the store of value because the saving should be the similar value over the time
c. It is the medium of exchange as he has purchased the player where the money is exchanged with the product
In this way it should be categorized
KNK bank receives a deposit of GHS 1,000 and observes a cash ratio of 10%. Assuming there is no cash drain(cashless economy) and all rxcess reserves are pushed into loans. a. what is the maximum amount of money that can be pushed into loans. b. what is the total increase in money supply with the bank?
The maximum amount of money which can be created from the deposit will be GHS 1,000 and the total increase in the money supply with the bank will be GHS 1,000 too.
Money supply has to do with the total amount of money that's in circulation in a particular period of time in an economy.
A) Based on the information given, the maximum amount of money which can be created from the deposit will be GHS 1,000.
B. The total increase in the money supply with the bank will be GHS 1,000. The reason for this is because there were no additional information that was given.
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Your team is working hard to develop a strategy to serve a new client. Which of the following actions is most important to ensuring an effective strategy is chosen?
a. Suggest that each proposed strategy be evaluated against a set of key objectives.
b. Invite the client into a meeting to shape the strategy.
c. Conduct a benchmarking survey of similar clients to determine best strategy.
d. Ask the team member with the most industry-related experience to lead the process.
Answer:
b. Invite the client into a meeting to shape the strategy.
Explanation:
It is very important when we invited the client for meeting so that we are able to share the strategy as the open and loose could be discussed in a proper way and in easy way also the suggestions are also welcome. In addition to this, the strategy should be taken place as per the preferences, requirements and choices of the clients
Therefore the option b is correct
Calculate the total Social Security and Medicare tax burden on a sole proprietorship earning 2020 profit of $300,000, assuming a single sole proprietor with no other earned income.
Answer: $25,802.70
Explanation:
Social security
Social security rates in 2020 for a single sole proprietor is 12.40% on the first $137,700:
= 12.40% * 300,000
= $17,074.80
Medicare Tax
First you need to remove a deduction of 7.65% from the income:
= 300,000 * (1 - 7.65%)
= $277,050
Medicare tax is 2.90% of this adjusted amount in addition to 0.9% for any amount above $200,000:
= (2.90% * 277,050) + (0.9% * (277,050 - 200,000))
= 8,034.45 + 693.45
= $8,727.90
Total Social security and Medicare:
= 17,074.80 + 8,727.9
= $25,802.70
Purple Cab Company had 70,000 shares of common stock outstanding on January 1, 2021. On April 1, 2021, the company issued 40,000 shares of common stock. The company had outstanding fully vested incentive stock options for 7,000 shares exercisable at $12 that had not been exercised by its executives. The average market price of common stock was $14. The company reported net income in the amount of $289,915 for 2021. What is the basic earnings per share (rounded)
Answer:
Purple Cab Company
The basic earnings per share is:
= $2.64 per share.
Explanation:
a) Data and Calculations:
January 1, 2021, Outstanding common stock shares = 70,000
April 1, 2021, Issue of new common stock shares = 40,000
December, 31, 2021, Outstanding common stock shares = 110,000
Outstanding fully vested incentive stock options = 7,000
Exercise price of options = $12
Common stock market price = $14
Reported net income = $289,915
The basic earnings per share = $ (Net income/Outstanding common stock)
= $289,915/110,000
= $2.64 per share
b) The basic earnings per share does not include the fully vested incentive stock options. It is only when calculating the diluted earnings per share that the stock options will be included.
XYZ expects to sell 28,000 pools in 2019. It budgets the beginning inventory of Direct Materials, Work-in-process, and Finished goods to be 26,000; 0; 1,300 units; AND ending inventory to be 26,000; 0; 2,800 units. How many pools need to be produced
Answer:
the no of pools need to be produced is 29,500 units
Explanation:
The computation of the no of pools need to be produced is given below:
= Ending finished goods inventory units + number of units sold - beginning finished goods inventory units
= 2800 + 28000 - 1300
= 29500 units.
Hence, the no of pools need to be produced is 29,500 units
TB MC Qu. 08-156 Fortune Drilling Company acquires... Fortune Drilling Company acquires a mineral deposit at a cost of $5,900,000. It incurs additional costs of $600,000 to access the deposit, which is estimated to contain 2,000,000 tons and is expected to take 5 years to extract. What journal entry would be needed to record the expense for the first year assuming 418,000 tons were mined
Answer:
Fortune Drilling Company
Journal Entry:
Debit Depletion Expense $1,350,000
Credit Accumulated Depletion $1,350,000
To record the first year's expense.
Explanation:
a) Data and Calculations:
Acquisition cost of mineral deposit = $5,900,000
Additional costs incurred = $600,000
Total costs of mine = $6,500,000
Estimated mineral deposit = 2,000,000 tons
Estimated years of extraction = 5 years
First year's extraction quantity = 418,000
Expenses for the first year = 418,000/2,000,000 * $6,500,000
= $1,350,000
Analysis:
Depletion Expense $1,350,000 Accumulated Depletion $1,350,000
A single commercial bank must meet a 25 percent reserve requirement. If the bank has no excess reserves initially and $5,000 of cash is deposited in the bank, it can increase its loans by a maximum of Group of answer choices $5,000. $1,250. $120,000. $3,750.
Answer:
$3,750
Explanation:
Calculation to determine what it can increase its loans by
Using this formula
Loan increase=Excess reserves-(Reserve requirement percentage* Excess reserves)
Let plug in the formula
Loan increase=$5000-($25%*$5000)
Loan increase=$5,000-$1,250
Loan increase=3,750
Therefore it can increase its loans by a maximum of $3,750
The cost of equity is ________. the interest associated with debt the rate of return required by investors to incentivize them to invest in a company the weighted average cost of capital equal to the amount of asset turnover
Answer:
If an = 3n - 2 , find a2
Explanation:
If an = 3n - 2 , find a2If an = 3n - 2 , find a2
To meet projected annual sales, Bluegill Manufacturers, Inc. needs to produce 75,000 machines for the year. The estimated January 1 inventory is 7,000 units, and the desired December 31 inventory is 12,000 units. What are projected sales units for the year? fill in the blank 1 units
Answer: 70,000 units
Explanation:
You can use the formula for the ending inventory to get this:
Ending inventory = Opening inventory + Production for the year - Projected sales
12,000 = 7,000 + 75,000 - Projected sales
12,000 + Projected sales = 82,000
Projected sales = 82,000 - 12,000
Projected sales = 70,000 units
Budgeted Actual Overhead cost $909,000 $884,000 Machine hours 55,000 46,000 Direct labor hours 101,000 98,000 Overhead is applied on the basis of direct labor hours. (a) Compute the predetermined overhead rate. (Round answer to 2 decimal places, e.g. 12.25.)
Answer:
Missing word "(b) Determine the amount of overhead applied for the year?"
1. Predetermined overhead rate = Budgeted overhead / Budgeted direct labor hours
Predetermined overhead rate = $909,000 / 101,000
Predetermined overhead rate = $9 per DLH
2. Overhead applied = Actual hours * Overhead rate
Overhead applied = 98,000 * $9 per DLH
Overhead applied = $882,000
The accounting records of Jamaican Importers, Inc., at January 1, 2021, included the following: Assets: Investment in IBM common shares $ 1,345,000 Less: Fair value adjustment (145,000) $ 1,200,000 No changes occurred during 2021 in the investment portfolio.
Prepare appropriate adjusting entry(s) at December 31, 2021, assuming the fair value of the IBM common shares was:_____.
1, $ 1,175,000
2, $ 1,275,000
3, $ 1,375,00
Answer: See explanation
Explanation:
The appropriate adjusting entry(s) at December 31, 2021, given the fair value of the IBM common shares are represented below:
1. 31, December 2021
Dr Unrealized holding gain or loss - NI $25,000
Cr To Fair value adjustment $25,000
(To record adjustment to fair value)
2. 31, December 2021
Dr Fair value adjustment $75,000
Cr To Unrealized holding gain or loss - NI $75,000
(To record adjustment to fair value)
3. 31, December 2021
Dr Fair value adjustment $175,000
Cr To Unrealized holding gain or loss - NI $175,000
(To record adjustment to fair value)
Mitch and Jennifer have adjusted gross income of $125,000 and they have not planned for their children's education. Their children are ages 17 and 18 and the parents anticipate paying $20,000 per year, per children for education expenses. Which of the following is the most appropriate recommendation to pay for the children's education?
A) 529 Savings Plan
B) PLUS Loan
C) Pell Grant
D) Coverdell ESA
Answer: B) PLUS Loan
Explanation:
Seeing as they did not plan ahead and the children are about to start school, the best option they have is a loan. In light of that, they should go for a Parent Loan for Undergraduate Students (PLUS) loan.
A PLUS loan is provided by the Federal government to parents to help them pay for the tuition fees of their children at undergraduate level. It has a lower interest rate but is only given to people whose credit history are not to bad.
Vortex Company operates a retail store with two departments. Information about those departments follows:
Department A Department B
Sales $832,000 $448,000
Cost of goods sold 410,000 291,200
Direct expenses:
Salaries 117,000 86,000
Insurance 13,500 10,900
Utilities 21,000 25,500
Depreciation 18,000 13,500
Maintenance 6,400 5,200
The company also incurred the following indirect costs.
Salaries $29,000
Insurance 6,600
Depreciation 14,800
Office expenses 40,000
Indirect costs are allocated as follows: salaries on the basis of sales; insurance and depreciation on the basis of square footage; and office expenses on the basis of number of employees. Additional information about the departments follows.
Department Square footage Number of employees
A 29,400 66
B 12,600 44
Required:
a. Determine the departmental contribution to overhead and the departmental net income for department A and Department B.
b. Should Department B be eliminated?
Answer:
Vortex Company
Department A Department B
a. Contribution margin $246,100 $15,700
Net income $188,270 ($16,870)
b. Department B should not be eliminated unless the indirect costs allocated to it can be eliminated as well.
Explanation:
a) Data and Calculations:
Department A Department B
Sales $832,000 $448,000
Cost of goods sold 410,000 291,200
Gross profit $422,000 $156,800
Direct expenses:
Salaries 117,000 86,000
Insurance 13,500 10,900
Utilities 21,000 25,500
Depreciation 18,000 13,500
Maintenance 6,400 5,200
Total direct expenses $175,900 $141,100
Contribution margin $246,100 $15,700
Total indirect expenses 57,830 32,570
Net income $188,270 ($16,870)
Department Square footage Number of employees
A 29,400 66
B 12,600 44
Total 42,000 110
Indirect Costs: Costs Rates Department A Department B
Salaries $29,000 $0.02266 $18,850 $10,150 ($448/$1,280)
Insurance 6,600 $0.15714 4,620 1,980
Depreciation 14,800 $0.35238 10,360 4,440
Office expenses 40,000 $363.64 24,000 16,000
Total costs $90,400 $57,830 $32,570
You made an investment of $15,000 into an account that paid you an annual interest rate of 3.8 percent for the first 8 years and 8.2 percent for the next 10 years. What was your annual rate of return over the entire 18 years
Answer: 6.22%
Explanation:
To find the annual rate of return, find the geometric mean of the returns:
= ¹⁸√ (1 + 3.8%)⁸ * (1 + 8.2%)¹⁰ - 1
= ¹⁸√ 2.9638173484126186153 - 1
= 1.0622187633434 - 1
= 6.22%
A strategy of related diversification requires most firms to organize around geographical areas or product lines. This type of organizational growth leads to a(n) ________ structure.
An owner can lease her building for $160,000 per year for three years. The explicit cost of maintaining the building is $55,000, and the implicit cost is $70,000. All revenues are received, and costs borne, at the end of each year. If the interest rate is 5 percent, determine the present value of the stream of:_______.
a. Accounting profits.
b. Economic profits.
Answer:
a. Accounting profits.
Account profit = Revenue - explicit cost
= 160,000 - 55,000
= $105,000
Present value of $105,000 per year for 3 years is:
= 105,000 * Present value interest factor of an Annuity, 3 years, 5%
= 105,000 * 2.7232
= $285,936
b. Economic profit
Economic profit = Revenue - explicit cost - implicit cost
= 160,000 - 55,000 - 70,000
= $35,000
Present value of $35,000 per year for 3 years:
= 35,000 * Present value interest factor of an Annuity, 3 years, 5%
= 35,000 * 2.7232
= $95,312
Note: The profits were treated as annuities as they were constant.
In the process of conversion from the equity method to the fair value method, the earnings or losses that the investor previously recognized under the equity method should
Answer: remain as a part of the carrying amount of the investment
Explanation:
Equity method is simply the process whereby investments are treated in associate companies. It usually occurs when the investor entity holds about twenty to fifty percent of the voting stock of the other company.
It should be noted that in a process of conversion from the equity method to the fair value method, the earnings or losses that the investor previously recognized under the equity method should remain as a part of the carrying amount of the investment.
